Average 401(k) Balance Climbs to $155,800
IRA Assets Also Hit Record as Hardship Withdrawals Rise
Retirement savings among U.S. workers reached record levels in the second quarter of 2026, fueled by a recovering stock market and steady contributions. At the same time, however, more Americans borrowed from or withdrew money from their retirement accounts as they struggled with rising living costs.
According to Fidelity Investments’ latest quarterly retirement analysis released Thursday, the average 401(k) balance increased 13.1% from a year earlier to a record $155,800.
The average balance in Individual Retirement Accounts (IRAs) also reached an all-time high, rising 10% year over year to $144,523.
Fidelity attributed the gains to a rebound in financial markets following volatility earlier this year. The Dow Jones Industrial Average has climbed about 10% year to date, while both the Nasdaq Composite and the S&P 500 have gained roughly 12%.
Steady retirement contributions also supported account growth. The combined employee and employer contribution rate remained unchanged at 14.4%, just below Fidelity’s recommended annual savings target of 15%.
“When positive market performance is combined with consistent savings behavior, retirement balances continue to grow,” said Mike Shamrell, Fidelity’s vice president of thought leadership.
Average savings also varied significantly by age. Workers in their 30s held an average 401(k) balance of $75,200, while those in their 40s averaged $156,800.
Despite the strong investment gains, the report also highlighted growing financial strain among many households.
The share of workers with an outstanding 401(k) loan rose to 19.5%, slightly higher than a year earlier. In addition, 2.8% of participants took out a new loan from their retirement accounts during the second quarter.
Hardship withdrawals also increased. The percentage of workers making penalty-qualified hardship withdrawals rose from 2.6% a year ago to 3.0%, with many citing emergency living expenses, medical bills, or the need to avoid eviction or foreclosure.
“Everyday expenses have risen much faster than many workers’ incomes, creating cash-flow pressures for households,” said Cathy Curtis, a certified financial planner and CEO of Curtis Financial Planning in Oakland, California.
Financial experts continue to caution that borrowing from or withdrawing retirement savings should be considered only as a last resort. Such moves reduce the long-term benefits of compound investment growth and can jeopardize retirement security if repeated over time.
